LONDON, Jan 4 (Reuters) - European shares fell sharply on Monday, the first day of trading for 2016, as weak Chinese economic data weighed on world stock markets.
The pan-European FTSEurofirst 300 index fell 2.3 percent, while the euro zone's blue-chip Euro STOXX 50 index declined by 2.6 percent.
China's factory activity contracted for the 10th straight month in December and at a sharper pace than in November, a private survey showed, dampening hopes that the world's second-largest economy will enter 2016 on a more stable footing.
The weak data caused Chinese and Asian shares to slump, with China's benchmark CSI300 share index tumbling 7 percent on Monday, prompting the stock exchange to halt trading for the rest of the day.
Shares in carmaker Fiat Chrysler fell after the spin-off of its Ferrari division, but French conglomerate Bouygues outperformed to rise 1.3 percent after a media report that Orange was moving closer to buying Bouygues' telecoms arm for 10 billion euros ($10.86 billion).
(Reporting by Sudip Kar-Gupta; Editing by Atul Prakash)